Georgia Bankruptcy Blog

"Updated" Means Test Numbers for January 1, 2008.  If the numbers look similar, it is because they did not change.

        * Add $6900 for each additional dependent.

You can get the full list for all states at the United States Trustee Website. 

By: Scott B. Riddle, Esq.

From todays AJC -

A campaign to stem rising numbers of foreclosures locally and statewide was announced Wednesday by metro Atlanta civic leaders and elected officials.

Free counseling and a 24-hour hotline will be offered through the 1-888-995-HOPE campaign to help homeowners avert foreclosure.

In 2006, metro Atlanta ranked second among urban areas nationwide in its foreclosure rate, according to RealtyTrac, a national foreclosure database. Georgia consistently ranks among the top states for foreclosures per household in RealtyTrac's monthly reports.
...
The 1-888-995-HOPE hotline will offer free, confidential advice in English or Spanish from counselors who can provide referrals and information about how to work out a plan that can avoid foreclosure.
...
Suzanne Boas, president of Consumer Credit Counseling Service of Greater Atlanta, said the foreclosure hotline is the first partnership of its kind in the nation.

"We are looking at and other people are looking at how to replicate this across the country," Boas said.

To call Scott, click below to be conntected -----

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Posted By: Scott B. Riddle, Esq. (Ph: 404-815-0164)

I can't attest to the accuracy of this, but you can find an online means test calculator by clicking here.  It is not a replacement for sitting down with a lawyer, but may provide individuals some idea how close they are to qualifying for a Chapter 7 case.  Keep in mind that most recent studies show that a large percentage of people who filed Chapter 7 under the old law (pre-October 2005) would still be eligible under the BAPCPA.

Posted By: Scott B. Riddle, Esq. (Ph: 404-815-0164)

Note: The following is a reprint (retyping) of a Guide for Consumer Bankruptcy in Georgia.  There are several sections, and I hope to get them all posted over the next couple of weeks as I review them and note any changes because of the new law or recent court decisions.  I also hope to make the entire document available in .pdf form.  Questions and comments welcome. 

GUIDE TO CONSUMER BANKRUPTCY LAW IN GEORGIA

I. Introduction

The purpose of this Guide is to provide practical information about consumer Bankruptcy, and more specifically, consumer Bankruptcy cases filed in the State of Georgia. This includes Bankruptcy cases filed under Chapter 7 and Chapter 13 of the Bankruptcy Code. Although individuals may also filed under Chapter 11, those cases are relatively infrequent and require specialized advice from a Bankruptcy lawyer. While much of the information contained in this Guide is relevant to a Chapter 11 individual Debtor, we do not separately discuss Chapter 11 cases.

We have tried to use a minimum of legal-ease, but it is important to identify and define many of the common terms unique to Bankruptcy cases. 

Although this Guide is written primarily for those individuals who may be contemplating filing for Bankruptcy, it is not a substitute for advice from a qualified Bankruptcy lawyer who has reviewed the facts and circumstances of a particular case. Rather, this Guide should be used as basic information or as a primer for preparing for a meeting with a lawyer. 

II.        What is Bankruptcy?

The term “Bankruptcy” has its origins in Latin: “Bancus,” meaning bench or table, and “ruptus,” meaning broken. In ancient times, many businesses were conducted from benches or tables. If the business failed, the bench was broken.  Thus, the two terms were combined to form the modern word “bankruptcy,” or “broken bench.” The word has since been used to refer to the absence of a quality or resource – “financially bankrupt,” “morally and ethically bankrupt,” etc.

For purposes of this Guide, the term “Bankruptcy” will refer to the process under federal law designed to help consumers and businesses eliminate their debts or repay them under the protection of the United States Bankruptcy Court, which is a federal court. For individuals, the process is initiated by the filing of a Bankruptcy Petition under Title 11 of the United States Code. The Petition is filed under either Chapter 7, Chapter 11, or Chapter 13 of the Code, and each of these chapters are discussed below. The term “debtor” will refer to an individual who has filed a Bankruptcy Petition.

You may hear the term “fresh start” used as describing the goal of Bankruptcy.

Scott B. Riddle, Esq.

404-815-0164

sbriddle@mindspring.com

Posted By: Scott B. Riddle, Esq. (Ph: 404-815-0164)

Note: This is the next section in the Consumer Guide to Bankruptcy in Georgia, re-typed for the Blog.  Comments and questions welcome.

                                  GUIDE TO CONSUMER BANKRUPTCY LAW IN GEORGIA

I. Introduction

II. Chapter 7 Cases

III. Chapter 13 Cases

IV.  Exemptions: What Can I keep?

One of the most important factors in deciding whether to file for Bankruptcy and, if you are going to file, under which Chapter, is what do you get to keep? The answer to this question can often be answered by looking to the exemptions allowed under the law.

Exemptions are, simply stated, what individuals are allowed to keep in a Bankruptcy case or in a collection action filed by creditors. In Georgia, these exemptions are set out in state law. Remember, in a Chapter 13 case, you may be able to retain all of your personal property, even if it is non-exempt. This is one of the advantages of Chapter 13.  However, practically speaking, most consumer debtors will end up keeping all or most of their property in a Chapter 7 because it is subject to exemptions or because any non-exempt property would not be worth the time and expense involved in selling it. 

1.  What Property Can I Exempt?

The following is a short list of the most common exemptions allowed under the law. It is important that you disclose all property to your Bankruptcy lawyer (as required by law), so that your lawyer can provide specific advice regarding what you may exempt. The reality is that most individual debtors will be able to retain most or all of their property in a Chapter 7 or 13.  

Posted By: Scott B. Riddle, Esq. (Ph: 404-815-0164)

Note: This is the next section in the Consumer Guide to Bankruptcy in Georgia, re-typed for the Blog.  Comments and questions welcome.

                                  GUIDE TO CONSUMER BANKRUPTCY LAW IN GEORGIA

I.  Introduction

II. Chaper 7 cases.

III.  Chapter 13

Chapter 13 Bankruptcy is often referred to as “reorganization” or “wage earner’s plan,” and is initiated by filing a Chapter 13 Petition in Bankruptcy Court.  The Petition may be filed by an individual or jointly by a husband and wife.

 Chapter 13 differs from Chapter 7 in two primary respects. One, unlike a Chapter 7 Debtor, a Chapter 13 Debtor submits a Plan by which the Debtor will pay some or all of his debts over a period of time (at least three, usually five years). The second primary difference is that a Chapter 13 Debtor is able to retain some, if not all, non-exempt assets that would otherwise be sold by the Trustee in a Chapter 7 case. Thus, if a Debtor completes the Plan, he will likely be able to keep all of his assets and receive a discharge of most or all of the debt not paid through the plan (except debts that are secured or non-dischargeable).

Upon the filing of the Petition, a Chapter 13 Trustee will be appointed and a first meeting of creditors will be scheduled within a month of the filing. Prior to this meeting, the Debtor will be expected to submit a plan and make plan payments to the Chapter 13 Trustee even though the plan has not yet been confirmed by the Court. 

The first meeting of creditors is a formal meeting (not a court hearing) conducted by the Chapter 13 Trustee and provides an opportunity for the Trustee and creditors to ask questions about the Debtor’s petition, schedules or plan. It is also an opportunity for the Trustee to identify any problems or potential objections to the plan so that they may be corrected prior to the confirmation hearing.

A confirmation hearing will be scheduled a few weeks after the first meeting of creditors. If there are no objections to the plan, or all objections are resolved prior to the hearing, the plan may be confirmed without the Debtor appearing at the hearing, depending on local practice and the facts of the case. The Debtor’s attorney will determine whether the Debtor must attend.  

Posted By: Scott B. Riddle, Esq. (Ph: 404-815-0164)

Note: This is the next section in the Consumer Guide to Bankruptcy in Georgia, re-typed for the Blog.  Comments and questions welcome.

                                  GUIDE TO CONSUMER BANKRUPTCY LAW IN GEORGIA

I.   Introduction

III.        Types of Bankruptcy

1.     Chapter 7

Chapter 7 Bankruptcy is often referred to as “liquidation,” and is initiated with the filing of a Chapter 7 Bankruptcy Petition.  In its most simple form, Chapter 7 involves the Debtor surrendering all non-exempt assets to the Trustee so the Trustee can sell the assets and distribute the proceeds to the creditors, and in return, the Debtor receives a discharge of most or all unsecured debt.

A Chapter 7 case may be filed by an individual, or jointly by a husband a wife. When the Petition is filed, a Chapter 7 Trustee is appointed to administer the assets of the bankruptcy estate. The estate generally consists of the Debtor’s property that is not subject to exemptions (discussed in detail below). A Chapter 7 case is usually the shortest case in duration, and a Debtor often receives a discharge of some or all debts in just a few months. 

Often, the Debtor will not have to attend and court proceedings other than the first meeting of creditors.  This meeting is an opportunity for the Chapter 7 Trustee and creditors to ask questions about the Debtor’s petition and schedules, and other issues related to the filing. Most creditors do not attend the meeting, but it is not uncommon for larger creditors to attend and ask questions.

In practice, Debtors are in bankruptcy precisely because they do not have significant assets they can sell to pay debts or because they have already sold the property to stay afloat. Many, if not most, Chapter 7 Debtors get to keep all of their property because the property is subject to exemptions or because the Chapter 7 Trustee believes that the value of the nonexempt property is not worth the time and expense involved in selling the property and distributing the proceeds to creditors. For example, a Debtor may own a home worth $200,000 and the equity (value of the property minus the amount owed on the secured loan) in the home is $25,000. Under Georgia law, a Debtor may exempt $10,000 in equity in the home, leaving nonexempt equity of $15,000. In theory, the Chapter 7 Trustee could seek a sale of the house to obtain the $15,000 in nonexempt equity to distribute to creditors. However, in practice, the attempted sale of the house may lead to a sale price below market value due to the necessity of a quick sale, and the real estate commissions, closing costs and attorney’s fees will often be far more than the $15,000 the Trustee hoped to collect. The same analysis applies to other items, such as clothing, furniture, some jewelry, sporting goods and other household items. 

What property will the Trustee claim for the estate? This is determined on a case by case basis, but some examples are excess equity in a primary residence; equity in other real property owned by the Debtor; stamp, coin or firearm collections; automobiles owned free and clear not subject to exemptions; boats, campers and other recreational vehicles; jewelry and furniture in excess of exemptions; stocks and bonds and other interests in corporations or businesses; and, the Debtor’s interest in pre-petition causes of action against others (for example, claims for damages arising from pre-petition automobile accidents, claims against employers, or other claims for recovery). A Bankruptcy lawyer will review a Debtor’s personal property and will be able to determine the likelihood that the Trustee may want to sell some of the property.